Splash has a wide range of products covering facial care, Exfoliants, Whitening Lotions, Natural soaps and hair care. Most of the products are under the Splash brand while there are also sub-brands like Bio-Link and Maxipeel.
The word 'Splash' is immediately recognizable as a company trademark. The Hortalezas briefly renamed their company Hortaleza Cosmetics in 1986, before settling on Splash Cosmetics in 1987. The Splash name was inspired by the popular movie that bore the same title. It was chosen because it was easy to recall and carried connotations of being cool and refreshing.
Value Proposition
Innovative and high quality beauty products that are safe for people to use with and at the same time are effective to people who use it.
Using Splash products generates feelings of friendliness and excitement
“I used it and it worked for me.”
Marketing Strategy:
Splash employed a multi-brand strategy, which was believed to be the most effective way of covering such a broad industry and reaching tens of millions of consumers. Different brands and their respective products might have similar or overlapping effects, and a single product might actually be sold in more than one category; however, only one brand was chosen as the “lead brand” in each product category. The company allocated all of its marketing and branding support for a given category to the corresponding lead brand. For example, both the Extraderm and Maxi-Peel products were exfoliants, but Maxi-Peel had emerged as the lead brand in the exfoliant category while Extraderm was being repositioned as a broader beauty line. Splash resorted to “guerilla marketing.” Splash developed below-the-line marketing materials and promotional activities to interact with consumers. Splash sent representatives to school fairs, prom nights and community activities, set up in-store promotions and distributed samples to households.
Branding Strategies to be employed by Splash to maintain its success in the industry:
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Brand Essence: Brand essence is everything a brand stands for in the heart of the customer. It is the abstraction that audiences take away after experiencing the sum of brand impressions-from both the marketing and personal experience with the product, transaction process and service. There is the inclination for marketers to perceive the essence of a given brand from their own perspective rather than from the customer's perspective. It derides the temptation for marketers trying to define the brand essence as what they want it to be, rather than what it actually is among customers. What causes some products like Coca-Cola, Campbell soups to be deep brands and to profit from a price premium while other colas, candies, and soups do not? The companies have high brand equity because they have a positive image, established brand, and reputable product.
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Brand Intrinsic Value: The intrinsic value a brand has in the market place is developed over a period through superior sustainable business strategies. For Splash new innovative products, its intrinsic value can be developed by extensive market research before the product enters the growth stage and then allowing it move slow in the growth stage so as to earn a premium and long product cycle.
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Financial - One way to measure brand equity for splash products is to determine the price premium that a brand commands over a generic product. For example, if consumers are willing to pay P100 more for a branded hair care product over the same unbranded hair care product, this premium provides important information about the value of the brand. However, expenses such as promotional costs must be taken into account when using this method to measure brand equity.
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Brand extensions - A successful brand can be used as a platform to launch related products. The benefits of brand extensions are the leveraging of existing brand awareness thus reducing advertising expenditures, and a lower risk from the perspective of the consumer. Furthermore, appropriate brand extensions can enhance the core brand. However, the value of brand extensions is more difficult to quantify than are direct financial measures of brand equity.
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Intangible: The intangible value associated with a product that cannot be accounted for by price or features. For e.g. Nike has created many intangible benefits for their athletic products by associating them with star athletes. Children and adults want to wear Nike's products to feel some association with these star athletes ("be like Mike" - for Michael Jordan). It is not the physical features that drive demand for their products, but the marketing image that has been created. Buyers are willing to pay extremely high price premiums over lesser-known brands that may offer the same, or better, product quality and features.
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Relative profitability: The relative profitability of customers not only helps promote retention of the best customers but also substantially improves marketing.
In all, for the Splash brand to be strong it must accomplish two things over time: retain current customers and attract new ones. To the extent Splash brand does these things well, it shall grow stronger versus competition, and delivers more profits to its owners.
2) Develop a response to each of the current and specific competitive threats: a multinational challenging Maxi-Peel, a host of domestic companies imitating Bio-Link, and various producers flooding the market with a variety of low-cost products.
Response to Multinational Challenge to Maxi-Peel
Coherence
The key promise of Splash in case of Maxi-Peel is the stimulation of creativity, innovative, beautiful and safe product. This is what Splash is selling to the customer and also the brand promises when one purchases its products.
Consistency
Splash should take a long term view in their brand building, from opening brand stores in Manila to worldwide. Splash should try to recreates the "Imagination and Innovation" metaphor and sensorial experience in these locations to the experience of building and creating models from Splash’s successful brands. To reinforce brand communication consistency, Splash should create a new entity in the form of a Global Brand PR Team based in Philippines.
Credibility
Splash brand and its products have been around for some time now and is producing high quality products. This rich heritage lends a lot of credibility to Splash as a brand.
Response to host of domestic companies imitating Bio-Link
Integration
The organization within Splash Corporation should be aligned to support a consistent brand image by streamlining the brand into 5 recognizable values of Creativity, Imagination, Beautification, Safety and Quality.
Differentiation
Splash should not just be a beauty product manufacturer but should also try to differentiate itself from the crowd by opening Experience body shops, organizing Splash football League or like opening of brand stores, similar to Nike Town.
Risk Management
Splash is an organization that always dares to be different and keeps in touch with current market trends. They are always willing to take risks if that it what they perceived the market wants. Example of this risk-taking is the entry into the hair care industry via green papaya product called Bio Link. Now it should form marketing alliances with the host of domestic companies so that there is no dent with market share. By doing this, they could leverage on their existing brand equity and transfer this brand equity through the domestic base to the consumers in regards to low pricing and value proposition.
Support: R&D
Splash should continuously re-invest in the brand through committed R&D programs via the Splash R&D. They work with universities and research institutes to learn what is the best launching medium for philipino adults to bring out the power of emotional feel and satisfaction.
Response to various producers flooding the market with a variety of low-cost products.
Focus
The CEO for Splash should provide a common vision for the brand and employees with a brand vision that states..."to become the world's strongest brand among females in age 20-40 in year 2012". This would provide a focus for all employees to strive and work towards this achievable and realistic goal. This removes the focus from the producers of low-cost products to products that are oriented to the satisfaction and performance with consumers of their product.
Relevance
Splash should evolve with changing times, as it is currently doing from a simple low cost beautification provider to premium and quality products. This could be achieved by the organization providing relevance to the brand by listening constantly to the ever-changing needs of customer and plugging-in to current market trends.
Leadership
Splash should recognize that in order for the brand to succeed, an integrated brand communication plan is crucial and to achieve this, there must be a person in charge of the brand, to provide consistent and constant brand messages and communications. They should appoint a Local Brand PR to communicate effectively their product strategy to the consumers. He should be focal point for all strategic brand planning and he should co-ordinate consistently and constantly all brand communications with regional brand PR teams in the organization. By this set up they could spend less on marketing communication, the benefit of which could be driven down to the mass customers in terms of price reduction and value proposition.
- Evaluate Splash’s prospects for expanding its hair care business and develop a branding strategy for their brands.
HISTORY OF HAIR CARE BUSINESS
Splash had been active in hair care since early in its history, even before developing exfoliants; however, Splash’s hair care line was soon eclipsed by its skin care line. By 2004, the company derived only 10 per cent of its revenue from hair care products.
HAIR GEL MARKET
After phasing out its hair spray solution, Splash developed a styling gel to compete with imported brands, such as Dep from Schwarzkopf & Henkel. By 2005, Splash had two lines of styling gels, which were branded as Control and Tricks. Hair gel was a price-sensitive market because the core users were teenagers with little disposable income. Splash and its competitors kept their prices low and distributed much of their product in sachets. They did little in terms of marketing and promotion. Control was priced approximately 20 per cent lower than Dep.
OTHER HAIR CARE PRODUCTS:
Splash also offered a line of hair-coloring agents, or dyes, under the Kolours brand. The primary consumers of hair dyes were adult women, who had more money to spend on hair care products than teenagers did, and the market for coloring agents was far more competitive than the market for styling gel.
COMPETITIVE POSITIONING:
Splash’s main rival for hair-coloring agents was L’Oreal, a premium, imported brand. L’Oreal had a larger marketing budget than Splash; however, Morales felt Splash had an advantage over L’Oreal and other imported brands because, in his opinion, Splash’s formulations were more suitable for Asian hair. Morales also felt that Splash’s prices, which were approximately 30 per cent to 50 per cent lower than those of the premium brands, were more appropriate for the Filipino masa. Splash’s mix of product and price had been effective, and Splash had claimed the top market share for coloring agents. Hortaleza noted the hair care category was the largest in the cosmetics and toiletries industry. He wanted to see Splash launch more hair care products, particularly mainstream products, such as shampoo and conditioner, in the next three years. This strategy would see Splash challenging dominant hair care companies head-on. The competition would be tough. Procter & Gamble, for example, offered the popular Pantene and Rejoice shampoos and conditioners, Colgate-Palmolive offered the Palmolive shampoos and conditioners, and Unilever offered Sunsilk shampoos and Creamsilk conditioners.
BRANDING STRATEGY FOR SPLASH’S BRANDS
- BRAND AWARENESS
Brand awareness measures the accessibility of the brand in memory. Brand awareness can be measured through brand recall or brand recognition. Brand recall reflects the ability of consumers to retrieve the brand from memory when given the product category, the needs fulfilled by the category, or some other type of probe as a cue. Brand recognition reflects the ability of consumers to confirm prior exposure to the brand. In order to build brand awareness of its hair care products, it could leverage on the brand recall of other successful products like the Whitening Lotion.
- Brand Recognition
In a recognition task, consumers see a stimulus (e.g., an ad by Splash) and must say whether they have seen it before (e.g., last night on television, in magazine X, etc.). It is important to make the task as realistic as possible by allowing only a realistic amount of time and by using realistic stimuli and context. They should use recognition as a measure of the performance of different marketing actions (say, different logos or ads), they should expose one group to one version of the target stimulus and another group to the other version of the target stimulus. However, to make the task more realistic, both groups should also be exposed to other stimuli (e.g., competitors' brands like L’Oreal). In a second step, people see the "old" stimuli again, along with new ones and are asked to say if they have seen them before or not.
- Brand Image
Brand image is defined as consumer perceptions of a brand as reflected by the brand associations held in consumers' memory. To measure brand image, one can either use and adapt an existing list of brand associations (e.g., Whitening Lotions by Splash) or start from scratch by eliciting brand associations and by then measuring the strength of these associations. The outcome of this exercise would be a short list of the positive and negative associations consumers have with the brand, ranked by their strength. For comparison purposes, it would be useful to report the average strength of each association with the brand and the strength of the association with competing brands and to do this for each target segments. They could use techniques such as projective, constructive and laddering techniques to measure the brand strength and its associations.
- Favorability
The favorability of most associations for the Shampoo product could be straightforward. However, some associations may be ambiguous (e.g., is associating Splash brand with Philippine positive or negative?). In these cases, they could measure the favorability of each association and then report positive and negative associations separately.
- Measuring Brand Equity
- Conjoint Analysis
Conjoint analysis is a widely-used technique that measures the value of each product attribute (e.g., technical attribute, price level, the brand, etc) from people's overall choices or evaluation. The positive aspect of conjoint analysis (also called trade-off analysis) is that consumers are not asked to directly evaluate the importance of each attribute but rather to make choices between bundles of attributes. Measurement brand equity is not the primary use of conjoint analysis, which is most often used to test and forecast the market share of new products, as in case of new hair care products by Splash.
- Hedonic Regression
The purpose of hedonic regressions is to explain the price of a product on the basis of its attributes. They could compute a predicted price for each product parse. The difference between the predicted and the actual price is called the price premium of the brand and is a measure of brand equity.
- Brand Value
Brand value is the financial value of the brand. The ability to value and put a price tag on a brand's value may be useful for a number of reasons: Strategic Alliance with domestic partners, brand licensing and brand management decisions.
RECOMMENDATIONS
There are numerous ways of measuring consumers' perceptions and responses to brands. The key is to use multiple techniques because each has its own value. I would recommend to always measuring brand awareness, to use at least two methods to elicit brand associations (e.g. laddering technique, or projective techniques and at least one method to measure brand equity (e.g. Hedonic Regression). Similarly, it is advisable to use a cost approach to measure brand value. Finally, to be meaningful, the results of these methods must be used in comparison with a benchmark like Loreal. For example, knowing that 50% of the target consumers know Splash brand is useless, unless you know what the typical awareness score is in the category. Splash should therefore not only measure the dimension studied for the target brand as in case of hair care products but also for its direct competitors for the hair care products.